A transmembrane aspartyl protease termed β-site APP cleavage enzyme 1 (BACE1) that cleaves the amyloid-β precursor protein (APP), which is abundant in neurons, is required for the generation of amyloid-β (Aβ) peptides implicated in the pathogenesis of Alzheimer's disease (AD). We now demonstrate that BACE1, enriched in neurons of the CNS, is a major determinant that predisposes the brain to Aβ amyloidogenesis. The physiologically high levels of BACE1 activity coupled with low levels of BACE2 and α-secretase anti-amyloidogenic activities in neurons is a major contributor to the accumulation of Aβ in the CNS, whereas other organs are spared. Significantly, deletion of BACE1 in APPswe;PS1 Δ E9 mice prevents both Aβ deposition and age-associated cognitive abnormalities that occur in this model of Aβ amyloidosis. Moreover, Aβ deposits are sensitive to BACE1 dosage and can be efficiently cleared from the CNS when BACE1 is silenced. However, BACE1 null mice manifest alterations in hippocampal synaptic plasticity as well as in performance on tests of cognition and emotion. Importantly, memory deficits but not emotional alterations in BACE1 – / – mice are prevented by coexpressing APPswe;PS1 Δ E9 transgenes, indicating that other potential substrates of BACE1 may affect neural circuits related to emotion. Our results establish BACE1 and APP processing pathways as critical for cognitive, emotional, and synaptic functions, and future studies should be alert to potential mechanism-based side effects that may occur with BACE1 inhibitors designed to ameliorate Aβ amyloidosis in AD.